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Question on MAV

This topic contains 16 replies, has 0 voices, and was last updated by Avatar of andyswan andyswan 15 years ago.

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  • #93
    Avatar of andyswan
    andyswan
    Member

    Hey all:

    I’m having a brain freeze today.

    #7385
    Avatar of sserio
    sserio
    Member

    Since you already know the property is currently worth $100K, the MAV is a figure you feel comfortable with. You are saying to your potential resident beneficiary, “this is what the value of this particular property”.

    #7386
    Avatar of andyswan
    andyswan
    Member

    Ah Hah…..I think I might get it….

    #7387
    Avatar of sserio
    sserio
    Member

    Andy,

    The MAV should be bumped up, no matter which way any potential future appreciation is split or not. ?This is a way for you to create additional profit in the deal for yourself. ?Also, depending on how the transaction is negotiated, remember the RB should be paying an additional amount monthly or as part of their upfront contirbution, for each benefit they are interested in, (i.e. able to participate in it’s appreciation and equity build-up … get the full tax write-off … participate in the mortgage loan principal reduction, etc.). ?

    The NEHTrust System is so versatile it’s like putty not puddy … you can shape it in any form you need too to accomplish what is necessary to complete your deal. ?There isn’t another system available that can match what Bill’s system can do.

    Sal

    #7388
    Avatar of bill_gatten
    bill_gatten
    Participant

    Sal,

    Puddy? ?Is that like…a mixture of putty and pudding? ?

    Sounds yummy.

    BTW, did you hear about the the couple who were climbining into bed with passion on their minds and discovered that someone had mixed window putty in with the KY Jelly?

    Yep, all their windows fell out.

    Bill

    #7389
    Avatar of sserio
    sserio
    Member

    Ok Bill, so I can’t spell and it’s a poor analogy.

    [red]This is an encroachment my jocularities.[/red]

    Sal

    #7390
    Avatar of andyswan
    andyswan
    Member

    You guys are funny.

    #7391
    Avatar of mr._c
    mr._c
    Member

    Hey Andy,

    I’m a newbie with this pactrust also in NY also trying to put a deal together. Just were in ny are you using the pactrust and if possible you could help me understand it alittle better.

    #7392
    Avatar of bill_gatten
    bill_gatten
    Participant

    Mr. C.,

    In you’re in NY, then attend the workshop this weekend at the SLC Center on 7th AVe. ?(Fri 6:30 pm, Sat 8:30 am to 9:00 pm and Sun 9:00 am to 5:00 pm).

    Call 1 800 684 7788 to sign up.

    Bill

    #7393
    Avatar of sserio
    sserio
    Member
    Quote:
    ?In my case, the amount of money I “bump up” will probably equal how much money I spent in Closing costs. ?
    ?

    Andy,

    FYI, the amount you bump up for the MAV DOES NOT have anything to do with Closing Cost … ?Hopefully in just about every transaction the Closing Cost should/will be COVERED by your incoming Tenant Beneficiary and in some cases also the Seller, so the point here is the MAV does not need to based off of the Closing Cost. It is basically another potential profit center for the investor, that you, the investor control.

    Sal

    #7394
    Avatar of bigdaddy
    bigdaddy
    Member

    I agree with Sal.

    #7395

    I am a new network member and am puzzling about the MAV to be shown in the initial proposal with a prospective seller following the first telephone conversation.

    As I understand from our calls made during Bill’s recent Orange County seminar (an excellent seminar!), we should not discuss a proposed offer price during the first phone conversation.

    #7396
    Avatar of sserio
    sserio
    Member

    Michael,

    Well obviously you need to do some checking/research on the values of recent sales of comparable properties in the area of said property, but I know you knew that. So, yes I agree it is not easy to come up with a mutually agreed value (MAV) before even seeing the property. I know my experience has shown, on more then one occasion, that when initially speaking with a seller, when asked, “what the condition of the property is?” or “does the property need any repairs?”, that I have been told by the seller, “the property does not need any repairs?”, only to find out that there are major repairs necessary. So in somes cases it boils down to, “do you feel comfortable with what the seller has told you over the phone?” or you probably just need to advise the seller that as long as you are able to substantiate the value then you will be making your offer for a MAV of $x dollars.

    As far as offerring the asking price, you might try explaining it something like:

    “I?ll pay whatever is fair, which in most cases is gonna be your asking price minus any applicable refurbishment, repairs and marketing expenses, if any ?

    #7397

    Thanks very much for the helpful reply.

    #7398
    Avatar of jim_pasquini
    jim_pasquini
    Member

    Michael,

    Is it your belief that your offer binds you and there is no way you can get out of the offer once you see the house?

    Actually, this clause is not that bad because all you would have to show is the seller knew it and didn’t disclose it.

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